Why IT Projects Fail: Lessons from High-Profile Failures

In a world where technology evolves overnight, IT projects have become a constant part of business strategy. So why aren’t we better at it yet? A staggering number of IT initiatives still fail. According to a 2018 study by the British Computer Society (BCS), only 13% of IT projects were deemed successful, meaning they were delivered on time, within budget, and met their initial specifications. An often cited statistic from the likes of Forbes, McKinsey, Kotter and others indicates that 70% of strategic change initiatives do not achieve their intended outcomes.

Why do so many projects fail? One key reason stands out across various industries and case studies: it’s not just about technology—it's about people. It doesn’t matter what technology your digital transformation project is implementing, it’s people that drive change and make things happen. To make your software projects successful, it’s people that need to adopt the technology and that means getting them engaged, involved and invested in making the change a success.

From the research in Super User Networks let’s explore some infamous project failures and provide best-practice advice to ensure your IT project doesn’t meet the same fate.

Notable IT Project Failures

Apple’s Copland Operating System

In a bid to compete with Microsoft Windows back in the 90s, Apple embarked on developing the Copland operating system for Mac. However, the project became a textbook example of scope creep. As different departments requested additional features and requirements, the project’s delivery was delayed repeatedly, and ultimately, it was cancelled before completion.

Lesson: Prevent scope creep by involving users early in the design phase, locking down requirements, and focusing on delivering a core set of features that are going to have the most impact on your overall business strategy. Additional requests should be part of a future release or project backlog.

Dorset County Council IT Restructure

Dorset County Council’s IT project faced significant backlash from users who found the new system much slower and less intuitive than their previous one. Feedback showed that 58% of users felt negative about the system due to concerns over training, usability, and support.

Lesson: IT projects should be done with the business, not to the business. Proper training and user acceptance testing (UAT) are vital to ensure user satisfaction and avoid project rejection.

FBI Virtual Case File Project

The FBI's Virtual Case File project had an unrealistic timeline and attempted a “big-bang” Go Live approach, retiring the legacy system and introducing the new system in one weekend. The abrupt transition led to disruption and a unusable and incomplete system.

Lesson: Consider avoiding a “big-bang” Go Live. Instead, implement a phased approach, allowing users time to adopt the new system gradually and minimising disruption. Alternatively, using your employees as Super Users can be a huge advantage to deploy for cutover rehearsals and data migration testing, ensuring you're well prepared for predicted issues.

FoxMeyer’s Warehouse Management System

FoxMeyer’s project was rooted in unrealistic timelines and unaddressed fears from employees. User resistance and even active sabotage led to a costly and overrun project that severely affected service delivery.

Lesson: Engage with users early to understand their fears and concerns. Super Users can act as change agents, helping mitigate resistance by communicating the benefits and offering support during the transition.

Haribo’s ERP Upgrade

Haribo’s ERP upgrade suffered because the technology build didn’t align with the company’s strategy or business requirements. Processes that had been built around the legacy software were expected to work in the new system but loss of revenue and supply chain disruption at go-live soon showed this wasn’t the case.

Lesson: Ensure your technology is aligned with business strategy, and involve users from the start in re-engineering processes to meet both desired business outcomes and the functionality of your new system. And understand that there will always be disruption, with good change management and business readiness planning you can mitigate this impact.

Hershey’s ERP Implementation

Hershey’s rushed to Go Live with its ERP system during their peak for Halloween pre-orders, despite users being inadequately trained. The result was supply chain disruption that led to missed orders and lost revenue.

Lesson: Training should never be squeezed to meet arbitrary Go Live dates. Allow enough time for users to become competent before facing peak operational demand. Proper user training is non-negotiable for business readiness - utilise evaluations or competency assessments to measure employee capability to go live.

Israel Chemical Ltd’s ERP Project

This company-wide ERP implementation was led by finance, but the supply chain and manufacturing teams were not consulted. Resistance became apparent from employees who felt the system was being imposed on them, leading to poor user engagement and a lack of progress that ultimately saw the project being abandoned.

Lesson: IT projects must involve all relevant business areas. Recruit Super Users from all functions to ensure that the system meets the needs of the entire business, not just one department.

Revlon’s ERP Implementation

When Revlon launched their new ERP system they immediately faced issues in manufacturing. These issues disrupted Revlon’s ability to manufacture goods and fulfil orders, causing sales losses and leading to expensive remediation efforts. Revlon acknowledged the system's lack of effective design and internal controls impacted their operations, even a year later.

Lesson: Thorough testing and system controls must be in place before Go Live. Ensure the ERP aligns with operational needs, and don’t rush to implement the system without comprehensive checks. Having a contingency plan is critical, but it’s better to prevent such disruptions through careful readiness planning and business user involvement.

National Grid (USA) ERP Go-Live

Under pressure to Go Live during hurricane season despite ongoing test failures and unresolved defects, National Grid launched its new system prematurely. When they went live despite advice to the contrary, employees were paid incorrectly and vendor invoices couldn’t be processed – distracting them from their core business purpose and adversely impacting performance.

Lesson: Never Go Live with critical defects outstanding. Adequate time must be planned for defect resolution after the testing window, and business readiness should not be signed off until the system is fully functional. Ensure your testing team have the objective to find the defects – not pass the tests, which can lead to bias and pressure to report passes to leadership. Every defect found and fixed should be welcomed, as it’s an issue your users and business no longer have to experience.

Target Canada's ERP Rollout

Target’s Canadian expansion failed in part due to poor data migration to their new system. Entry-level temporary employees had been recruited for the task and manually entered the data into the new system, leading to only 30% of their master data being accurate. This caused widespread supply chain disruptions and financial chaos.

Lesson: Data validation is a crucial task in any IT project. Use experienced staff as Super Users to sign off on the final data to ensure its accuracy.

The Fujitsu Horizon Post Office Disaster

This one example should forever be in all IT articles that advocate for learning from failures and the importance of listening to, and trusting, users. The Fujitsu Horizon software, used by the UK Post Office, was plagued by technical flaws, including rounding errors and known bugs causing duplicate entries and data corruption. Despite knowing there were issues, the system was pushed live, resulting in catastrophic financial and legal consequences, including the wrongful prosecution of over 700 sub-postmasters.

Lesson: Listen to feedback from end users and experts. Address technical issues thoroughly before implementation, and avoid contractual arrangements with IT vendors that incentivise quick delivery over robust solutions.

Best Practice for Ensuring IT Project Success

• Involve Users Early and Often - IT projects need to be co-created with the business, not handed to them at the end. Engage Super Users in the design, testing, and training phases to ensure alignment with business needs and make them feel invested in the project success.
• Lock Down Requirements - Scope creep is a common reason for project failure. Define and lock down the core requirements early in the process. Any additional features could be added to a future release plan or backlog. But still a note of caution, technology evolves so quickly that if your project timeline is too long you may need to revisit your objectives to stay aligned with the capabilities of emerging technologies.
• Invest in Training and User Adoption - Even the most well-designed systems will fail if users don’t know how to use them to their full potential. Allocate adequate time and resources for user training. Super Users should be responsible for delivering and validating training, as they have the business knowledge needed to make it relevant and practical.
• Develop a Strong Change Management Strategy - A well-thought-out change management strategy is essential to identify and address resistance. Understanding where resistance may arise and implementing targeted interventions can prevent issues from derailing the project.
• Create Clear, Contextual Communications - Ensure that communications are tailored to each audience, clearly explaining how the changes will affect them and how they will be supported throughout the transition. This helps build trust and reduces uncertainty.
• Plan Realistically and Allow for Flexibility - Avoid setting unrealistic timelines just to meet a Go Live date. Ensure that you have a solid project plan by listening to your experts in the business about what is achievable. Utilise resource from your business through backfilling and project secondments for those times you need all hands on deck.
• Ensure Comprehensive Testing and Defect Resolution - Testing should not just be a box to check but should be thorough exercise to find the bugs that are inevitably always there. Time must be allocated for defect resolution before Go Live, and no critical defects should be ignored.
• Ensure Data Accuracy and Validation - Data migration should be rigorously planned and tested to ensure accuracy. Business users should sign off on the data before going live to avoid operational disruptions.
• Address User Concerns Proactively - Super Users should be used to gather feedback from the broader user base, addressing concerns about job security, changes in workflow, and other issues. Transparency about the impact of the new system is critical for maintaining morale and engagement.

You’d be forgiven for assuming that the technology is the most important component of a digital transformation project, but I’d argue that actually, it’s your people.

By engaging and involving the actual business users in the solution design and  testing and training strategies, organisations can significantly increase the likelihood of their IT projects being part of the successful minority.